Smartphones are the new car keys

That's probably what we'll be saying soon, because carmakers have
caught the tech bug, and now they're working nonstop to reinvent
everything we know about transportation.

As more vehicles hit the streets with advanced safety and
connectivity features, it's natural to expect that certain
artifacts of the car-ownership experience will one day disappear.

Volvo has announced that beginning in 2017 it will start selling
its new cars with digital keys only.

The service is part of a planned Volvo mobile app that will do
everything a physical car key can do, plus something extra.

The Bluetooth-enabled digital car key will live on a user's
smartphone, which can be used to lock, unlock, start, and drive
the car.

There are still lots of unanswered questions about the security
of this technology, but Volvo says people will be able to opt for
physical keys if they want them.

A sharing feature will allow users to send a copy of their
digital key to other phones, providing access to unlock and drive
the car.

"Apart from this, you can also receive a key," Volvo's director
of new cars, Martin Rosenqvist, said, "so for car-sharing or
rental services, you can now book, find, and access the car"
through the app.

A screenshot of the Volvo
on Call app.Bryan Logan/Business
Insider

Cars as a service

That's the other big news here. Volvo is getting into the
car-sharing business with its company Sunfleet.

A trial run will begin at Gothenburg Airport in Sweden this
spring.

Volvo is joining GM and Audi, among others, in diversifying its
business outside the traditional dealer-sales model.

It's a venture automakers are taking quite seriously after
witnessing the success of the ride-hailing giant Uber and
car-sharing services like Zipcar.

Audi also led a $28 million Series C funding round for the rental
startup Silvercar earlier this year. Silvercar maintains a fleet
of silver Audi A4 sedans — the only car you can rent from the
company's major airport hubs around the country.

The moves Volvo is making in this space show that the company has
a comprehensive strategy to help it regain market share in the
US. These latest initiatives come at a time when Volvo is just
beginning to see the fruits of a
multibillion-dollar turnaround that's already underway.